When we notice that your transactions might require you to register to collect and pay taxes in a new place in the U.S., we alert you on the AvaTax home page.
How it works
AvaTax checks your company's committed transactions every week to see if your sales have crossed any economic thresholds. When we think you've crossed a threshold, you'll see an alert on the home page. If you get one of these alerts, talk to your tax professional to decide if you should register to collect and pay tax in a new place. After you register, make sure to update where you collect and pay tax in AvaTax.
Keep in mind
- The economic threshold map updates weekly, so recent transactions might not be included.
- The map only analyzes states that you haven't added to Settings > Where You Collect.
- The map only appears when you've reached 80% of a threshold, or if we think you've already crossed one. If you don't see an active map on your home page, then we don't think you've passed any thresholds anywhere.
- Only information sent to AvaTax is used to determine if you've reached an economic threshold. If you have other sales outside of AvaTax, make sure to check if those send you past a threshold anywhere, or enter them into AvaTax and let us keep track of them for you.
- We calculate your sales totals as the sum of all committed sales invoices minus any return credits. Some U.S. states require calculation based on gross sales without considering any credits. You should keep a close eye on sales in those states and always check the laws in any U.S. location where you do business.
- Tax-exempt sales are included in our calculations for places where you might need to collect and pay tax. That's because AvaTax doesn't distinguish taxable from tax-exempt sales in places where you haven't told us you're registered to collect.
- In California, AvaTax only tracks thresholds for the state, not for the local jurisdictions within it which may have different rules.